8-K: Carter Bankshares Expands North Carolina Footprint with Acquisition of Two First Reliance Bank Branches

Carter Bankshares, Inc. has successfully completed the acquisition of deposits from two First Reliance Bank branches in North Carolina, adding $55.9 million in deposits and expanding its market presence.

Summary

• Carter Bankshares, Inc. (Nasdaq: CARE) completed the Purchase and Assumption of deposits from two First Reliance Bank branches located in Mooresville and Winston-Salem, North Carolina.
• The acquisition, finalized on May 23, 2025, involved Carter Bank acquiring $55.9 million in deposits.
• The transaction did not include the acquisition of any loans.
• Carter Bank welcomed 10 new associates to its team as part of the acquisition.
• A 4.6% deposit premium was paid on the average closing balance of non-interest and interest-bearing transaction accounts, savings, and money market demand deposits.
• The acquired branches were converted to Carter Bank branches during the weekend of May 24-26, 2025, and opened under the Carter Bank name on May 27, 2025.

Sentiment

Score: 8

Explanation: The sentiment is highly positive, reflecting successful strategic expansion, increased deposits, and positive management outlook on future growth and integration. The acquisition is presented as a key step in the bank's North Carolina expansion strategy.

Positives

• Successfully expanded operations into the Winston-Salem market for the first time, enhancing the bank's presence in North Carolina's Triad region.
• Further strengthened its footprint in the Charlotte area with a second Mooresville location.
• Acquired $55.9 million in deposits, contributing to the bank's deposit base.
• Integrated 10 new associates, expanding the team and potentially bringing local market expertise.
• Demonstrates the bank's commitment to fostering opportunities for individuals and businesses throughout North Carolina.

Negatives

• The bank paid a 4.6% deposit premium, which represents a cost associated with the acquisition of deposits.

Future Outlook

The acquisition signifies Carter Bank's strategic intent to continue building and expanding relationships in North Carolina, particularly by strengthening its presence in the Charlotte area and establishing a new foothold in Winston-Salem, indicating a focus on regional growth and market penetration.

Management Comments

• Carter Bank Chief Executive Officer Litz Van Dyke stated, "We're grateful for the opportunity to expand our operations in North Carolina and help the people of Winston-Salem and Lake Norman live life to the fullest. I'm very proud of our team's hard work to ensure the smoothest transition possible for both the customers and Bank associates, and we are very excited to continue building and expanding these relationships."
• Carter Bank President and Chief Strategy Officer Brad Langs commented, "In the last few years, we've expanded the Bank into Charlotte and Raleigh, while keeping an eye on the right opportunity to enter Winston-Salem, and this purchase was that opportunity. Additionally, the team at our Mooresville branch has worked tirelessly to help strengthen our presence there, and the Lake Norman branch will only help us keep that momentum going. I'm very excited about the future of the Bank."

Industry Context

This acquisition reflects a common strategy in the community banking sector where regional banks seek to expand their geographic footprint and deposit base through targeted branch acquisitions. By entering the Winston-Salem market and expanding in Mooresville, Carter Bank is leveraging opportunities to grow in attractive North Carolina markets, aligning with broader trends of consolidation and strategic expansion among smaller to mid-sized financial institutions.

Comparison to Industry Standards

• NA The document does not provide specific comparable companies, projects, or results to assess the acquisition's performance against global benchmarks or industry standards beyond the general strategic rationale.

Stakeholder Impact

• Shareholders: Potential for increased market share, deposit growth, and long-term profitability through strategic expansion.
• Employees: 10 new associates welcomed to Carter Bank, indicating job continuity and integration into the new organization.
• Customers: Customers of the acquired branches will transition to Carter Bank, potentially gaining access to Carter Bank's services and network.
• Local Communities: Increased banking presence in Winston-Salem and expanded presence in Mooresville, potentially offering more banking options and community support.

Next Steps

• Continue building and expanding relationships with new customers and associates in the acquired markets.
• Further integrate the acquired branches and operations into Carter Bank's existing network.

Key Dates

Recommendation

Keywords

Carter Bankshares, CARE, First Reliance Bank, FSRL, Bank Acquisition, Deposit Acquisition, Branch Expansion, North Carolina Banking, Winston-Salem, Mooresville, Community Bank, Financial Services